COVID-19 has a profound effect on the Fintech industry, and their reaction may surprise you!

COVID-19, and it’s dramatic impact on all walks of life, has dominated the headlines for several weeks now. What hasn’t dominated the headlines, however, is the way in which industries and communities within the Fintech industry have come together to support one another, along with the industry itself.

We at the Fintech Times have watched these developments unfold with pride and delight, and we wanted to shine a spotlight on those who have chosen to do the right thing in these difficult times.

We will be updating and sharing the list regularly, in order to make sure that those who have taken steps to act in an altruistic manner will get the attention and recognition that their efforts deserve. Below is a small taster of some of the support that is being offered throughout the industry to assist those in most need.

Consumer & employee-facing initiatives

The first group of people who have been hit hardest by the impacts of COVID-19, will be the regular people, consumers and employees. Many will be facing job uncertainty, a potential drop in earnings, and possibly may be facing a lengthy period off work due to illness.

Governments have taken commendable steps to provide aid and support to those who will be most affected by this pandemic. But this does not mean that there are people out there who will not be struggling to pay bills, debts, and rents & mortgages.

One of the first ports of call for such people will be their banks. Some banks have, unprompted, taken swift and decisive action to provide support to their customers, whilst others have required a fair amount of peer pressure in order to provide such support.

Unsurprisingly, some of the best reactions have come from the startup fintechs. Monzo have offered a range of repayment options for their customers who hold overdrafts or loans, whilst Tide have been very proactive in providing a high-level of detail and explanation to all of their business customers, from the self-employed to business owners. In addition, Monzo’s CEO, Tom Blomfield, has stated that he won’t be taking a salary for the next twelve months, whilst the senior management team and board have all volunteered to take a 25% cut in salary.

To illustrate what measures are being taken and implemented by other financial institutions, financial guidance stalwarts Money Saving Expert have produced an extremely handy guide. Some examples include banks waiving interest on overdrafts, introducing interest-free overdraft buffers, offering mortgage and loan payment holidays, and sanctioning emergency credit limit increases. Barclays and Metro Bank deserve an honourable mention for coming out and waiving all overdraft interest for 3 months, well ahead the rest of the pack, and without customers needing to get in touch.

Kat Robinson, Director of Bank Accounts at Metro Bank, comments: “We’re mindful of the uncertainty caused by coronavirus and are committed to supporting our customers whose personal finances may be impacted at such a challenging time. We will therefore waive all overdraft interest due from the beginning of March until the end of June for personal current account customers. We hope that this will provide some flexibility for our customers as we all adjust to the unprecedented circumstances we find ourselves in.”

WorkinStartups have been one of the many companies who have been doing what they can to assist workers hunting for jobs during this period. They have set up a system where they are indicating which companies will still be hiring for roles during this time, to make sure that jobseekers don’t end up wasting their time by approaching a company that is no longer able to continue hiring for a position.

Assistance for Key Workers

Whilst many people find themselves working from home or being furloughed during this time, there are a number of employees who will still be going into the ‘office’ everyday for the foreseeable future – key workers. These include health workers, government employees, and persons whose jobs are vital to the infrastructure of countries. Many companies are now taking the opportunity to offer certain groups of employees discounts on goods on services, to thank them for the potentially dangerous work that they are carrying out.

One such company is Cabify, a ride-hailing company, who are offering free travel for government workers in Madrid who can’t take public transportation during this time. Another,

Offers for fellow Fintechs and other businesses

Obviously, it is not just workers and individuals who have been affected. The companies that they work for have also been going through significant hardship, with many finding that their work has dried up, along with clients being largely unresponsive. This is where we see the collaborative, resourceful, and positive nature of the Fintech community come into play.

Many, if not all, accelerators, co-working spaces, and startup hubs have now been closed down due to the virus and/or governmental regulations. Rise, created by Barclays, are one of the leading proponents of such a service, and have taken steps to do what they can for the startups and fintechs who rely on their service. They have written to all Rise members to inform them that they will be taking 3 separate actions. The first, and the one with the biggest impact, is to freeze Membership payments for their member companies in April & May, whilst their London location is closed. This will be invaluable to companies who are looking to free up some money during this period, in order to remain financially solvent.

In addition they will provide digital sessions, virtual access to services, personal well-being classes, and virtual events. They have also pledged to create further initiatives, based on further feedback from their community. Magdalena Krön, Rise Global FinTech Platform Director, gave a further explanation as to why they are taking these steps: “We at Rise wanted to do something very practical that would assist our global community in these tough times. So we froze our membership fees for April and May for existing Rise members. We’re glad that’s gone down well. It’s one way of showing our commitment to the ecosystem of FinTech companies and their employees, so they can continue doing what they do best – disrupting and innovating. Individual resilience is important at this time. So too is community spirit. That’s why Rise is developing new digital events and regular targeted content that can keep anyone working in FinTech informed and inspired in this new world.”

3S Money Club, the online banking service, and one of the companies hosted in Rise London, have taken the altruistic step of lowering fees on SEPA payments during this time. From now on, any EUR-out payments to SEPA-connected recipients will see the fees reduced from €8 down to €2 (flat fee irrespective of amount sent). Incoming payments in EUR and all other currencies will remain free of charge during this time. They believe that this small, but efficient contribution, could make a difference for many businesses challenged by an unprecedented level of uncertainty. Posting this announcement on their Linkedin page, they stated that “We are in this together, so let’s help each other to the best of our abilities and work out a reasonable approach to maintain a healthy financial ecosystem!”

We’ve seen what the startup jobs website, WorkinStartups, has been doing for workers. Fellow job-advert company, Angel.co, are also taking action to help out the startups who are doing their bit to help others, promising that “Any startup helping during this crisis can use our premium talent products for free.”

One of the biggest victims of this shutdown are bars, clubs and restaurants. Give Local is helping support local restaurants during this time, by allowing their users to buy a restaurant gift card from their website. Once the gift card has been purchased, the restaurant receives the money straight away, whilst the customer can then use this gift card to spend on a meal when this crisis is over. This will give the restaurant valuable and vital cash-flow during this difficult time, hopefully helping them to stay afloat.

Hosting of Virtual Events

Events, conferences, and meetings are the lifeblood of the Fintech industry, and are often vitally important for individual companies and startups. Nearly all of these have now been either cancelled or postponed for the coming months, leading to a scramble to work out how to arrange alternative ways of getting the benefits that these events provide.

Some events have been directly converting themselves into an online set up. This includes the Open Banking World Congress, who will now run the speaking agenda part of their Congress as a free of charge virtual event, which will also include real-time Q&A and polls. In addition, they will also be providing access to their networking event app for industry delegates that had already purchased tickets to their event. In a similar fashion, Innovate Finance’sUK Fintech Weekwill be running a series of webinars instead of their usual in-person event. This will allow them to still keep all of the interesting speakers that they have already signed up, whilst enabling their attendees to still benefit.

London-based virtual events company, Hopin, is also going from strength-to-strength with their recently launched product. Their offering is a unique mixture of livestreams, video conferencing, and one-to-one virtual conversations, which can be used for any number of events. Having already received a lot of interest from investors before the crisis, the company will surely now find their services in high-demand. In response to the current climate, they have opened up their early access platform, along with discounted pricing for everyone who has been affected by the coronavirus. In a statement on their website from co-founder Dave Schools, he states that “We hope that our platform can be used to keep your events going in an accessible and sustainable way — by bringing your event online and still achieving the interaction and engagement that in-person events provide — while keeping everyone safe at home.”

Taking a slightly more innovative approach, Facebook are also getting in on the act with their imminent plans to launch Horizon “an ever-expanding VR world where you can explore, play, and create in extraordinary ways”.

Resources & provided by Fintechs

Many companies are also taking this time as an opportunity to provide valuable tools and resources for people to use during this pandemic, either on their own, or in collaboration with others.

Babyscripts, a virtual care company for managing obstetrics, are aiming to facilitate the access that new and expecting mothers have to valuable information and data that is relevant to them and their pregnancy. They have teamed up with George Washington Medical Faculty Associates (GW-MFA) to compile a new resource-base that contains clear, concise and relevant recommendations and information, complete with accessibility from a mobile app. Babyscripts state that they will also mount similar campaigns during the Coronavirus outbreak, for all of their health system partners.

“At times of crisis like this, access to accurate information is key for reducing anxiety and panic,” said Juan Pablo Segura, President and Co-founder of Babyscripts. “There’s a lot of conflicting information floating around on the internet, and pregnant women are especially vulnerable because they’re in a unique situation that complicates their normal responses to things like virus-protection”

Staying on the parental theme, there is the startup School Closures, who are providing guidance to parents while their children remain at home. They are a free hotline and information hub that will cover online learning, food, childcare, remote work, financial security. It’s a collaborative effort, involving a dozen or so organisations, such as Khan Academy, Crisis Text Line, Twilio and Revolution Foods.

Finally, there is the work being done by Fintechs in order to provide support and assistance to self-employed workers, a group number around 5 million, who will be particularly at risk during this period due to insecurity of work, lack of clients, and financial difficulties. A group of Fintechs have formed together, to create a product now known as “Covid Credit”. Founded by Fronted and Credit Kudos, they were able to collect a number of other volunteer companies, and managed to turn around a proof of concept of this product in 48 hours.

The product, which will likely be available in app form, enables sole traders in the UK to self-certify that they have lost income due to the Coronavirus outbreak. By using the newly-implemented Open Banking protocols, sole-traders will be able to connect this app to their bank accounts in order to share their last 12 months of statements and earnings. This will enable sole-traders to demonstrate to HMRC their change in financial circumstances, which will potentially lead to increased support from the government in the form of financial aid. They are now just waiting on the green light from the UK Government, in order to make this app publically available for all. It’s a fantastic effort, and shows recognition from the Fintech community as to how important freelancers, the self-employed and sole-traders are to the industry as a whole.

Share your stories of Fintechs doing their bit

The response from the Fintech community has been so positive, and really heart-warming. Hopefully, this is just the tip of the iceberg, and we will be seeing many more initiatives rolled out in the coming days and weeks.

Do you have a company, or know of one, that is going above and beyond during these difficult times to provide assistance or a benefit to the wider community? If so, we would love for you to get in touch so we can add them to this fantastic, fast-growing list.

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